From rice purchases to minimum wages to government handouts, clear long-term plans for the future being replaced by short-term election promises.

Leading economists expressed concern the government’s paddy mortgage project is ineffective in addressing the wealth gap and is leading to significant losses of fiscal resources.

They said the government should stop its market intervention measures as well as the minimum wage increase, tax waivers for home and car buyers and debt suspension.

Niphon Poapongsakorn, president of the Thailand Development Research Institute, said the government’s 15,000-baht-per-tonne paddy mortgage project, which is well above market value, has resulted in 18 million tonnes stored in warehouses the state is finding hard to unload.

If the government sells the huge stocks domestically, it will dampen market prices and incur even deeper losses. If it fails to sell the rice, then all the money spent on pledging will become fiscal liabilities and millers will have little space for paddy in future seasons.

The market price of milled rice is US$600 a tonne, making it impossible to sell Thai rice at its pledged price $800 per tonne of paddy. Meanwhile, only 1 million out of 3.8 million farming households nationwide are capable of producing paddy in excess of their own consumption in order to pledge, said Dr Niphon.

“Small-scale farmers have not benefited from the paddy pledging programme. Some of them have come to realise they’ve been misled, thinking they would be eligible for the programme,” he said.

Dr Niphon said local exporters may be able to deliver their orders from tapping their old stocks or those of neighbouring countries. He called for government disclosure of paddy stock auctions for examination of corruption.

Assoc Prof Panupong Nitiprapa, dean of Thammasat University’s economics faculty, said boosting the daily minimum wage to 300 baht spoke to the reduction of the wealth gap, as wages excluding inflation have regressed over the past two decades.

However, he said people should understand the state should have less influence in setting wages going forward.

Supavud Saicheua, the managing director of Phatra Securities, said the government is wrong to create economic policies based on the perception that it should intervene in the market to boost economic growth and reallocate wealth.

“It seems the government would like the economy to take off as a plane by starting all engines with a hands-on approach,” he said.

It hoped when it bought up the rice supply that foreign buyers would flood us with orders, as global supply was squeezed. But only 30 million tonnes of rice are now traded in the world market compared with total production of 400 million tonnes. No one wants to buy the rice.

The government’s hope that the corporate income tax reduction would help firms deal with the daily minimum wage hike was impractical, as small firms’ profits usually do not reach the level where they would benefit from the tax cut, said Dr Supavud.

He added that the government should ensure the 2.2-trillion-baht investment in improving infrastructure and 350-billion-baht flood prevention system will generate sound economic returns and that implementation moves forward as planned.

Veerathai Santiprabhob, the Stock Exchange of Thailand’s chief strategist, said the government is delivering election campaign promises without charting any clear course for the future of the economy.

Fiscal liabilities incurred from state projects have been hidden in specialised financial institutions, allowing stable public debt. The debt and growing needs for social welfare compensation could snowball into fiscal problem, he said.

slam – to criticize strongly (describe how bad something is and how it should be changed) วิพากษ์วิจารณ์อย่างรุนแรง วิพากษ์วิจารณ์slam policies

economists slam government policies

concern – a worry ความกังวลexpressed concern

paddy – rice after it has been harvested from the field ข้าวเปลือกgovernment’s paddy mortgage project

ineffective – does not work well, does not produce intended results

wealth – how much money and assets a person or country owns

gap – a large difference between people or groups ช่องว่างwealth gap – the difference in wealth between the poor and rich

address a problem – work at solving a problemaddressing the wealth gap

fiscal – related to government spending; connected with the government budget, i.e., public money เกี่ยวกับงบประมาณ

resources – things such as money, workers and equipment needed for a person or organisation to function properly ทรัพยากร ทรัพยากรที่มีอยู่fiscal resources – money, materials and people that the government has available to use

significant – large enough to be important or have an effect ที่สำคัญยิ่งsignificant losses of fiscal resources

Leading economists expressed concern the government’s paddy mortgage project is ineffective in addressing the wealth gap and is leading to significant losses of fiscal resources.

intervention – becoming involved in a situation and trying to change it การแทรกแซงmeasures – actions taken to deal with a problem มาตราการ

market intervention measures

wage – an amount of money that you earn for working, usually according to how many hours or days you work each week or month ค่าจ้างdaily minimum wageminimum wage increase

waiver – when you are given permission to not do something or not pay some amount of moneytax waiver – when you are given permission to not pay some taxestax waivers for home and car buyers

debt – an amount of money that you owe หนี้suspension – stopping for a period of time (temporarily)debt suspension – when borrowers don’t have to pay back their loans for a period of time

They said the government should stop its market intervention measures as well as the minimum wage increase, tax waivers for home and car buyers and debt suspension.

above market value – more than the true value of something (the price people are willing to pay for it in a market)warehouses – large buildings to store goods in

state – government รัฐfinding hard to unload – difficult for them to sell these goods

Niphon Poapongsakorn, president of the Thailand Development Research Institute, said the government’s 15,000-baht-per-tonne paddy mortgage project, which is well above market value, has resulted in 18 million tonnes stored in warehouses the state is finding hard to unload.

rice miller – a company that prepares rice to be sold in bagsspace for – a place to put and store something (example: the warehouse is full and has no more space to store rice)

millers will have little space for paddy

If the government sells the huge stocks domestically, it will dampen market prices and incur even deeper losses. If it fails to sell the rice, then all the money spent on pledging will become fiscal liabilities and millers will have little space for paddy in future seasons.

pledge – 1. promise as collateral (in the government rice price support system); 2. to make a serious promise to do something สัญญา seriously promised to do something สาบาน

rice pledging scheme – the government system of making sure that farmers get a good price for their ricepledged price – the price that farmers get for their rice from the government

households – families or groups of people living together (economics treats this as a unit that makes decisions)nationwide – throughout a whole country ทั่วทั้งประเทศ3.8 million farming households nationwide

excess – greater than is usual; too much of something มากเกินปริมาณที่พอดีin excess of – more than

consumption – 1. using, eating or drinking something; 2. when households buy goods and services (See Wikipedia) การบริโภคin excess of their own consumption – more than than they use and eat themselves

capable – able to do something มีความสามารถcapable of producing paddy in excess of their own consumption in order to pledge

The market price of milled rice is US$600 a tonne, making it impossible to sell Thai rice at its pledged price $800 per tonne of paddy. Meanwhile, only 1 million out of 3.8 million farming households nationwide are capable of producing paddy in excess of their own consumption in order to pledge, said Dr Niphon.

“Small-scale farmers have not benefited from the paddy pledging programme. Some of them have come to realise they’ve been misled, thinking they would be eligible for the programme,” he said.

local exporters – exporters in this country

tap – usestocks – goods that they have (that are being stored for future use or sale)old stocks – goods they have had for a long time (that have been in storage for a long time)

tapping their old stocks – use the goods that have been in storage for a long time

deliver their orders from tapping their old stocks

stock – an amount of something that you keep so that you can use it when you need it ที่เก็บไว้ในสต๊อกpaddy stock – rice that is stored (for future use or sale)

disclosure – making facts known to the publicdisclosure of paddy stock auctions for examination of corruption

Dr Niphon said local exporters may be able to deliver their orders from tapping their old stocks or those of neighbouring countries. He called for government disclosure of paddy stock auctions for examination of corruption.

dean – a senior official at a college or university อธิการบดี

faculty – a group of departments in a college which specialize in a particular subject or group of subjects คณะeconomics faculty – the department and all the teachers of economics at a university

boosting – increasing เพิ่มboosting the daily minimum wage

reduction of the wealth gap

wages – the amount of money earned per hour by a workerinflation – the level of prices rising in the economy as a whole ภาวะเงินเฟ้อ

decades – periods of ten years เป็นสิบๆปีwages excluding inflation have regressed over the past two decades

Assoc Prof Panupong Nitiprapa, dean of Thammasat University’s economics faculty, said boosting the daily minimum wage to 300 baht spoke to the reduction of the wealth gap, as wages excluding inflation have regressed over the past two decades.

influence – affect what people do or think; to affect or change how someone or something develops, behaves or thinks อิทธิพล มีอิทธิพลต่อ, ชักจูง อำนาจบังคับ

going forward – in the future (from now)

However, he said people should understand the state should have less influence in setting wages going forward.

perception – the way people think about an issue or situation, the impression that people have of something การรับรู้

intervene – to become involved in a situation in order to try to stop or change it (in an activity you’re not usually active in) แทรกแซง สอดแทรกintervene in the market

allocate – divide and give something to many people; divide among many people

re – againreallocate – to allocate again, in a different way, changing who gets what

reallocate wealth – take the wealth or money in a society and change who has or owns it (example: reallocate wealth from rich to poor or from middle class to poor)

Supavud Saicheua, the managing director of Phatra Securities, said the government is wrong to create economic policies based on the perception that it should intervene in the market to boost economic growth and reallocate wealth.

take off – when an airplane leaves the ground at the start of a flight

approach – a way of doing something or thinking about something, of solving a problem or carrying out a task วิธีการทำให้ถึงจุดหมาย a way of doing or dealing with something การจัดการกับปัญหา

hands-on approach – when you get involved in solving a problem yourself (rather than giving it to someone else to solve, not “delegating” the responsibility)

“It seems the government would like the economy to take off as a plane by starting all engines with a hands-on approach,” he said.

flood – a large amount or number of something จำนวนมากflood us with orders

global – throughout the world ทั่วโลกglobal supply was squeezed – low supply around the world; little of the good available to be bought

traded – bought and sold ค้าขายtraded in the world market – bought and sold in the world market

It hoped when it bought up the rice supply that foreign buyers would flood us with orders, as global supply was squeezed. But only 30 million tonnes of rice are now traded in the world market compared with total production of 400 million tonnes. No one wants to buy the rice.

income – money that people receive from work or some other source, used for household consumption and savingsincome tax – a tax on income

corporate income taxcorporate income tax reduction

impractical – not practical; of something that cannot be done or used easily or effectively ซึ่งไม่มีประสิทธิภาพเมื่อนำมาใช้งานจริง,ที่ใช้งานไม่ได้ an idea that does not work in the real world, not practical ไม่เหมาะสมในทางปฏิบัติ

benefit – to get help or an advantage from something ผลประโยชน์benefit from the tax cut

The government’s hope that the corporate income tax reduction would help firms deal with the daily minimum wage hike was impractical, as small firms’ profits usually do not reach the level where they would benefit from the tax cut, said Dr Supavud.

ensure – to make certain that something happens or is done รับรอง ให้ความมั่นใจ ให้การยืนยันinvestment – taking your money and putting it into projects to make a profit or earn interest (buying stock shares, bonds, real estate)infrastructure – the high-cost facilities that everyone in the economy shares (water, roads, electricity, trains) สาธารณูปโภค

2.2-trillion-baht investment in improving infrastructure

prevention – the act of stopping bad things from happening or things that people do to stop themflood preventionflood prevention system

generate sound economic returns – make a good profit, make a lot of money

implementation – actually do or carry out a plan; making a plan into reality; execution of a plan, making sure that something that is planned actually gets done (See glossary) นำ (แผนการ) มาบังคับใช้

implementation moves forward as planned – actually do and achieve what you planned to do

He added that the government should ensure the 2.2-trillion-baht investment in improving infrastructure and 350-billion-baht flood prevention system will generate sound economic returns and that implementation moves forward as planned.

election – the process of choosing a person or a group of person for a position, especially by voting elect (v) electoral (adj) synonym: the polls การเลือกตั้งcampaign – a planned series of activities designed to persuade voters to vote for a particular candidate or political party การรณรงค์หาสียง

election campaign promises – things that politicians promised voters to win their votes and get elected

delivering election campaign promises

charting – planningclear – easy to understandcharting a clear course – making a clear and easy to understand plan

charting a clear course for the future of the economy

without charting any clear course for the future of the economy.

Veerathai Santiprabhob, the Stock Exchange of Thailand’s chief strategist, said the government is delivering election campaign promises without charting any clear course for the future of the economy.

incur – do something so that you owe money to another person, or do something to lose money (examples: incur charges, incur costs, incur a debt, incur an expense, incur a loss, incur liabilities)

liabilities – debts; amounts of money that are owed by a company or a person หนี้สิน หนี้ขององค์กร money borrowed by a company (liabilities + owners’ equity = assets)

compensation – 1. money or other benefits that an employee receives for the work that they do; 2. money paid to a person for damage they suffered การจ่า่ยเงินชดเชย

social welfare compensation – help given, especially by the state or an organization, to people who need it สวัสดิภาพ

snowball – grow bigger and bigger in size over time (like a snowball rolling down a hill)snowball into fiscal problem

Fiscal liabilities incurred from state projects have been hidden in specialised financial institutions, allowing stable public debt. The debt and growing needs for social welfare compensation could snowball into fiscal problem, he said.

I was asked to talk today about the Closing the Gaps initiative and its impact on the state of Texas, and I’m happy to do that because its goals are absolutely critical to the future of Texas and have implications for the nation, as well.Demographics are behind this initiative, and demographics have everything to do with our theme today. I have been fascinated over the last couple of weeks by the flurry of features and news stories surrounding the fact that the United States population hit 300 million. Maybe the milestone got such widespread press because most of us are looking for a respite from war and election news, but it has been interesting to sit back and look at who we are as a nation. Newspapers, talk shows and news magazines are full of graphs and stories about what the country looks like now and what we will look like in 20, 30 or 40 years.

One story forecast what the nation will look like when the population hits 400 million, expected about the year 2043. By then, it says, the U.S. will be 22 percent Hispanic, up from less than 13 percent today, and Anglos‘ share of the population will have fallen from 70 to 55 percent while African-American numbers will grow slightly to a little more than 13 percent. But by 2043, 20 to 30 percent of the population will be multi-racial, blurring the lines among races altogether.

The face of Texas has already shifted to the point that today less than half the population is Anglo. We are a minority majority state. By the year 2020, Anglos and Hispanics will be about the same percentage of the population, and by 2040 more than half of all Texans will be Hispanic.

Shifting demographics mean that the face of higher education must also change. Currently, by age 25-29, about a third of whites in the United States have obtained bachelor’s degrees, while just 18 percent of African-Americans and 10 percent of Hispanics have a degree. In Texas almost one quarter [22 percent] of the population has less than a high school education – the highest percentage in the country. Thirteen percent of Hispanics have an associate’s degree or higher in Texas, compared to 40 percent of whites. In our state, the education gap between whites and minorities is widening, not closing. Despite increases in educational attainment for the Texas population as a whole, educational attainment for Hispanic males has actually declined over the last 20 years.

In the year 2000 the state of Texas took a long, hard look at its economic future, and alarms went off. Texas was faced with a “growing unskilled, under-educated population that cannot meet the demands of a technology-based workplace.” The average household income in Texas was expected to decline by $4,000 in constant dollars by the year 2030. Texas was faced with increased public spending on prisons, welfare and Medicaid as a result. Enrollment in higher education was increasing, but the participation rate was declining. The participation rate had been 5.3 percent in 1990, was 4.9 percent in 2000 and was predicted to fall to 4.6 percent by 2015. In contrast to Texas’ 4.9 participation rate, other large states were doing better: California’s was 6.1, Illinois’ was 6.0, New York’s 5.6. Additionally, the percentage of ninth graders who complete high school and enter college was dismal in Texas: 32 percent of Texas ninth graders completed high school and entered college, as compared to 54 percent in New Jersey, 49 percent in Illinois, 43 and 44 percent in California and New York.

That’s a lot of numbers, I realize. Sum it up by saying that Texas was behind the educational rates of other populous states and was falling farther behind. That forecast was not a pretty picture for the future economy of the state or for the quality of lives of future Texans.

The question was what to do about it. The legislature adopted an ambitious initiative called Closing the Gaps that proposed goals in participation numbers, graduation numbers, research funding and numbers of nationally recognized programs.

The first goal was the real news-maker, however. It called for Texas to put 500,000 more students into college by the year 2015 – half again as many as were enrolled in 2000. And that figure was later revised upward to more than 600,000.

To reach or even get close to this goal of Closing the Gaps, we are going to have to assure that a college education is a possibility for all our citizens. This means that it must be affordable to everyone. And right now we are going in the opposite direction. We are putting a college education farther and farther out of the reach of many of our people.

College tuitions are rising, and more and more students are being left behind because of costs. Most of those left-behind students are ethnic minorities. Low-income students, regardless of race, who score in the top quarter of standardized college admission tests attend college at the same rate as high-income students in the lowest quarter. Texas’ median family income remains well below the U.S. average. In fact Texas ranks 37th in the country. And our lower-income student population is the fastest growing segment of our public schools. Texas is No. 6 in the nation in K-12 growth, increasing by 11 percent between 1999 and 2005 with the largest percentage of growth among lower-income and minority students.

Between 1995 and 2005, average tuition and fees across the nation rose 36 percent at private four-year colleges and 51 percent at public four-year colleges. In Texas between 2002 and 2006, average tuition and fees at public universities increased 61 percent and at community colleges 51 percent.Costs have risen in large part because state funding nationwide has fallen to its lowest level in more than 20 years. In 1980 almost 10 percent of states’ budgets nationwide was spent on higher education. Today it’s 7 percent.

Nationwide, the state share of per capita personal income going to higher education has dropped almost 20 percent since 1977. Educational appropriations per FTE in public higher education institutions decreased 12 percent between 1991 and 2004. It is common place on state university campuses for financial officers to say that we used to call ourselves “state supported.” Then we changed it to “state assisted,” and now we should change it to “state located.”

If we continue on this trajectory, we poison our future economy in obvious and not so obvious ways. The most obvious way is lost tax revenue. Under-educated citizens earn less money, therefore pay less tax. A Census Bureau study out last week says that a college education is worth $23,000 a year. It reported that figure to be the gap between adults with a bachelor’s degree, who average $52,000 a year, and adults with a high school diploma, who average $29,000 a year. It also reported average annual earnings of $19,000 for high school dropouts and $78,000 for those with advanced degrees.

This educational advantage has been clear for a long time — more education, more money, although when I was an assistant professor, I probably would have argued with that! But there are not-so-obvious costs — quality-of-life costs — as well. An under-educated citizenry costs the state and nation in terms of health care, job training, welfare, and criminal justice spending.

Health care costs rise when citizens are uninsured, and percentages of those insured increase with educational attainment. Nationwide 8 percent of people with a bachelor’s degree are uninsured, compared to 25 percent of those with no high school diploma. In Texas costs are even higher: Texas has the highest non-insured percentage in the country — a 24 percent average but 39 percent for those with no high school diploma. College educated people by and large don’t go to jail; they live longer, smoke less and vote more.

So higher education is important not only to our individual good, but to our collective good as well. We have lost sight of this fact in recent years. The thinking has become, “If you get a degree, you’ll be better off; therefore, you should pay for it.” We have retreated from the notion of higher education as a public good.

We unveiled a statue of Lyndon Johnson on our campus this fall. It’s a wonderful likeness of Johnson as a young man, walking down the Quad with his books. The statue was a gift from our students, who believed — rightly so — that because we are the only Texas institution to have graduated a U.S. president, we should have a statue of that president. With the statue is a quote: “This nation cannot rest while the door to knowledge remains closed to any American.” Johnson said that and passionately believed it.

Almost exactly a year ago, we celebrated the 40th anniversary of the signing of the Higher Education Act by President Johnson on our campus in 1965. Education was close to Johnson’s heart. He believed education to be the solution to all the problems in the world. But while that notion came from his heart, it also came from his head. He knew that education was, and is, a wise and profitable investment for any country.

And he was hardly alone in his thinking. The Higher Education Act sailed through Congress – perhaps owing partially to the fact that LBJ was a master politician but probably more to the fact that Congress and the country saw higher education as a public good. Passing it was — in current language — a “no-brainer.”

While Closing the Gaps does not state the fact as such, its clear message is that higher education is a public good. Meeting the goals of Closing the Gaps will benefit not only those who will be brought into college but all of us. Perhaps it will help us get back on the track of viewing higher education with a higher purpose.

The Texas plan is incredibly ambitious. It’s as brassy as Ann Richards and as in-your-face as Lyndon Johnson. Of course, Texas is not alone in the goals it needs to meet for the future good of the state. But Texas is approaching it in a very Texas sort of way.

That wonderful Lone Star philosopher Jerry Jeff Walker may express this mind-set best in his recording of London Homesick Blues. He croons, “When a Texan fancies, he’ll take his chances; and chances will be taken, that’s for sure.” That’s what Texas is doing: taking a chance. It’s the biggest, boldest chance that Texas has taken in a long time, and it’s the right chance to take. Other states would do well to follow suit.